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tv   Keiser Report  RT  February 28, 2013 5:30pm-6:00pm EST

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wealthy british. time buyers. market. come to. find out what's really happening to the global economy with max concert for a no holds barred look at the global financial headlines tune into the report. more news today. these are the images the world has seen
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from the streets of canada. showing corporations today. welcome to the kaiser report i'm max kaiser slimeballs fuzzy area polly album is a single cell without a brain. yes i know what you're thinking it must be related to many of our central bankers and policymakers indeed they are close relatives but this particular simple slime mold can make surprisingly complicated decisions unlike the slimeballs of public office it can navigate its way through a maze solve a civil engineering problem our central banker slime molds and slime molds and
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various political offices can't even navigate a straight line out of the economic collapse caused by financial fraud engineers practicing simple cons that only a tourist or moronic slime mold could fall for yes uncomfortable truth is the likes of george osborne mervyn king timothy geithner and ben bernanke are dumber than simple slime molds the solution. for president prime minister and the queen of the world only this single simple can get us out of this mess right stacy indeed max kaiser slime mold smarts and if you look at this this is the slime ball navigating its way through a maze and it always finds the simplest straightest shortest route to the food now however if you turn to the rest of the clip you find out that there are actually also able to create advance complicated civil engineering projects after
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scientists placed food in the relative position of major cities in urban areas slidell to accurately recreated the rail system of tokyo and the major roadways england canada and portugal and. i want to turn to this next headline genius george must go say backbenchers you see of course the headline is genius for a slime mold he's considered quite intelligent but if you look at the photo of him that they put with this article in the sunday times he does look a lot like a slime mold well members of george osborne's own party were last night questioning whether he was the right person to run the economy warning that next month's byelection must produce clear results of course his party is very upset with the recent downgrade of u.k. debt they're no longer aaa oh no i think oz born is going to double down on his line moldy and this is not going to take the direct route to economic recovery goes
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through a detour called appeasing the banks stirrers that's what he's all about and he's got the banks have got his back so no he's not going to do the right thing he will continue to do the right thing but he'll stay in his position well look at it the case is quite simple so the slime mold how they navigate this complicated maze is that the slime mold is that one and a simple piece of food is that the other it wants that food now in the same situation george osborne the slime mold once g.d.p. growth or growing economy it should be quite simple if he instead he keeps on getting stuck in these various tax credits and various schemes of making people work for free or quantitative easing also so complicated things when in fact the problem is huge amount of fraud between his policy and growth in the economy the fraud however he refuses to even acknowledge let alone. get rid
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of from the equation yes it's a false choice the choice between austerity versus spending by the government neither one of those two choices will overcome the problem of having a trenched old got plenty of banks to terrorizing the u.k. economy until something is done about these four horsemen of the paper apocalypse there will be no sustainable growth market already is just going to exacerbate the problem by feeding the paper apocalyptic terrorist with more paper more easing more free money the solution offered by george osborne by mark carney by ben bernanke by mervyn king by timothy geithner has always been there devaluing our currencies creating inflation is going to help us but as we see from bloomberg regarding this downgrade of the u.k. economy britain's debt as a percentage of gross domestic product will climb to ninety eight percent next year
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from ninety percent last year and ninety five point four percent this year in two thousand and thirteen the european commission said in its winter forecasts so the debt is getting wars the debt to g.d.p. is getting worse and worse and worse and they keep doubling down and keep going forward down the wrong path well inflation is not necessarily a bad thing but the problem is you've got these four banks that are like trolls living under the bridge between the central bank and the real economy and that money doesn't get from the central bank to the real economy because these four trolls under the bridge of four biggest banks in the u.k. are constantly hoarding that cash and sucking up that cash and trading that cash amongst each other to keep their bonds from collapsing as they already should have years ago years ago now turning back to this chief slime mold here george osborne
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was born on a rock and a sterling set to tumble. so we could hold the hope of course that he would be on the rack many on our show have suggested that but experts warn there could be a major slide in sterling with the pound heading to parity with the euro for the first time since the financial crisis of two thousand and eight and two thousand and nine and of course george osborne thinks that's a good thing. well it's not a good thing because you're entering into a vicious downward spiral of death between the guilt market the u.k. sovereign bond market and the pound itself as the pound weekends you see that the government well pump up more cash to support the bond market which in fact will cause more pound weight this which will cause more pumped up cash to support the pound and foreign creditors are going to dump their guilt holdings and so interest rates will continue to rise to panel continue to fall and britain's economy is going to need a devaluation of between thirty and forty percent of the pound so to put that in
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layman's terms for you people out there the general population that means that petrol goes from one pound forty six peeper leader to two pounds and fifty p. per leader thank you george osborne now you talked about overseas investors dumping their guilt and one of the articles i read about this tumbling sterling was that you know they of course have the currency risk and ten year gilts here yield only two point two percent and yet in seven weeks sterling fell six point seven percent so they lost three years income in seven weeks that's an excellent point and the dynamics of this market are horrendous for investors who of course are helping to keep this economy afloat and the idea of the pound in the u.k. being a safe haven has been destroyed and marconi is just going to pour gasoline on to the bonfire of the u.k. bond apocalypse so gerrard lane an analyst at shore capital says the pound reaching
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parity with the euro is very much on the cards is the realisation that the british currency does not deserve to be on a premium compared with the dollar or the euro we said that here of course first you and jim rickards have said jim rogers also said that on the show long ago but we're also coming to the uncomfortable realization here at the awkward moment. that this country is led economically by someone who's dumber than a slime mold. well i was born is really. leading the u.k. economy into the gutter and the reliance on the city of london to generate some kind of g.d.p. growth is also being challenged by the move from the pendulum or the center of gravity swinging from the u.k. as a financial center to frankfurt because the euro is emerging as a much more stable currency than the pound so he keeps on pushing inflation as the
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solution the. loses every time it doesn't help anybody and we can see that the most important chart in british politics so this is following on simon rosenberg's the north star of obama's policy the most important chart in american politics which is if you look at this chart the same in the u.k. the same in the us and that is that household incomes have lagged behind g.d.p. and productivity growth so here's your inflation for you all the g.d.p. growth this inflation is going to the financial pushers so the dark blue line on the bottom is median household income and that's barely risen in ten years as you can see red line is output per worker soaring light blue at the top is g.d.p. per person so it doesn't take a rocket scientist to see this is what's causing a lot of the strife in a billet easy for people to service their debts because they're not capturing any of the gains in the economy the inflation the benefits of inflation are going to the very top. that's a that's i'm saying they have the trolls and their clients under the bridge are
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grabbing all the money is a rolls off the press and their stuff to get in their pockets and a stock getting into the real economy incomes are deteriorating in the u.k. there are more jobs being created the last twelve months but these are part time jobs these are minimum wage jobs and they they are not generating the taxable income sufficient to pay down a any of the deadmau5 debt is going up the deficit is increasing all the metrics of an economy are deteriorating and george osborne the slimeball is looking all smug and content that he's going to double down well actually forgot the most important part of that equation why the debt is rising people aren't they say there are more jobs being created but george osborne is including in that the free workers you know for this job back to work program they're forcing people to go back to work at powell land and various service sector jobs for free but they're counting them now as employed but of course they're not earning in income but of course they're going
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to have to go into more debt to get to the job right it's a serf experience program where people can get experience of being a debt slave and to serve ready for the new paper apocalypse and the emergence of a male feudal system so going back to that chart there one participant in a recent focus group organized by the think tank policy exchange explained her situation as this my income doesn't allow dot dot dot you know you go shopping and you're trying to cut your costs but your ends don't me any more i found over the last twelve to eighteen months i'm increasing my overdraft to make ends meet when's it going to stop i can't keep doing this yes the u.k. household budget twenty five percent is a lot of it to transport because the prices for transportation and rail systems and gas planers skyrocketing and that is setting. crease even more dramatically.
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yes the quality of life standard of life in this country is the cherry rating and george osborne is doubling down on the very policies to make it even worse all right stacy our thanks so much for being kaiser report thank you much on the next episode of the kaiser report i'll be speaking about iran and bankers in the meantime states in for the second half of this for the second half of my interview with a many many many sell monetary scientist professor at south kept up. there
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are twelve cities in the united states in which half of the people with hiv aids lives within a year of a diagnosis of each other over a six to two percent and. i don't mean this with this is a problem that frankly is substantially preventable it was like the big elephant in the room and nobody wanted to talk about they were really good public health campaigns that people were really focused on this problem you certainly should be able to have a lot less a trade policy something. could you take three sports three. three. three. three.
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video for your media project free media. dot com. welcome back to the kaiser report i'm pleased to welcome back to the show professor at south of the new austrian school this time professor sarah talk about silver backwardation manipulation liberation and also possibly about the austrian school professor welcome back to the kaiser report thank you very much i'm glad to be here all right professor we talk a lot about j.p. morgan's involvement and solar manipulation and but your work is interesting in that you've gone back you've written a piece going back to eight hundred seventy nine thousand nine hundred thirty five the world witnessed a spectacular event the collapse of the value of silver by more than eighty percent tell us about. this is. really amazing how economic
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historians ignore the. not just momentous but very this size event which is unprecedented in the whole history of civilization. namely the elimination of silver money altogether and it took that long from eight hundred seventy nine to nine hundred thirty five to accomplish that and as you say eighty percent of the value of silver was wiped out this is absolutely on president because it's not just the value that was being wiped out but also lick with a t.v. because ill those money just as acceptable as gold was and that completely disappeared and all the economic historians assume that this was
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nature or day but it was manipulating those pinus this is a good question which would take a lot of research to find out my guess is yes whatever it is worth is a conspiracy. between government and the banking system. which was never really been revealed very little is in the public domain people just assume that there is such a conspiracy but in fact nobody can prove it served by the nine hundred thirty five at the end of this collapse there was no more silver standard anywhere because china. which had been in the suicide standards in stein in memorial abandoned the symbol standard in nineteen thirty five so we can just say that was b.
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and the feet still there was no longer amount of money anywhere in new now there was a metal standard as i recall when jennings bryan he gave his famous speech not to be christopher dodd and a cross of gold and there was a site between. going back and forth between silver and gold and there was a bi metal standard and now both both metals are bendy monetized completely by now but not by. brian. jennings. for presidency i don't know three times and failed every time but what came out of it was the gold more no matter who it was as a fools to mouth a loser. it was. it was the foolish unary as charged by people like keynes and friedman the numbers above the reason
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was because they removed to use the right which meant the big big contract ok so let's flash forward to today when people say there's not enough gold or gold as an implied impractical as a monetary metal they forget the fact that there wasn't by metal standard there was sober people run a silver standard in a work great for decades oh for millenia now let me ask you this. because our friend hugo salinas price in mexico he's been flying around the world trying to get countries to bring back sober or to monetize over in places like athens and he's trying to in mexico so he's really the last vestige of this integrity and terms of metal. you're familiar with his campaign and you think you'll ever be successful at that. yes but you see my mother was mine is the effective system because it fixes the goofs who are if you want to the world really needs is a system with two monetary metals but not
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a fixed three issue the reduce you woods. in my opinion once you put into practice the bumped into must be legally fix the issue. is to do trouble right so you have you have a buy metal exchange or you have a metal standard there is a thing called the market the market can interact with the moderate monetary metal and you can have an economy where there is a reference point is based on something of intrinsic value but once you bring bankers into the equation once you bring derivatives once you bring central planning once you bring a fixed rate of exchange between these two metals things tend to go haywire there and then they blame the metals they don't let's try sells the war of their own.
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wanting to rig the market now i want to bring us to market rigging as a topic because. you've written extensively about the bond market and you wrote a piece recently or a couple years ago front running the fed in the treasury market and the reason this is important is because people say that the fed is printing lots of money they're buying lots of bonds to conduct quantitative easing printing lots of money but they don't see the inflation of all of this but in the most high profile case being paul krugman of the york times but you have done a little bit deeper thinking on this and kind of are able to give us the full picture to explain why a little bit about front running and why this is obscured the inflation debate yes this is the most amazing thing to me to my mind in the history of science that nobody but nobody save yours truly
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pointed out that the idea of keynes when he proposed that it's just a matter of printing the bonds and selling them would take care of all the momentary problems you see once you introduce a big pool open market operations which is the central bank going to be open market and and by the bombs the government bonds from the banks from ordinary people from see beings banks from pension funds and who want. this has a side effect which is to move those things and this is months kulish that's inside the fence because the mom spoke of the most stupid they know the the
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central bank is doing that so they are going to prevent this and they want to pocket money. really profits and they do and so of those who had the foose of keynesian economics school ops is on the problem of speculation let me ask you this because during the one nine hundred eighty s. when bill clinton was president there were a group of folks in the markets called the bond vigilantes you know and if that goes back to the nineteenth century or so if the government was going to be fiscally imprudent the vigilantes would sell off the bond market and this would somehow force the government to be more more prudent because interest rates would go up but what we've seen with these programs of quantitative easing is that the bond vigilantes have been neutralized they've been taken out of the picture because
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the government themselves are both the seller of the bonds and the biggest buyer of their own bonds so they have destroyed the price signal and the inflation that should be appearing more obviously has is showing up in what would be an historic i mean correct me if i'm wrong but it seems like the bond bubble the sovereign bond bubble in the u.s. and the u.k. and we can call it a bubble is in a storage bubble and that and when that finally does burst like all bubbles do we'll see that inflation but it will come all the sudden. and the very very end but in the meantime i. wouldn't like to confuse them on the beach and the bond speculated among the vigilantes and like you know it's a popular movement. but the one spoke of this special with the experts they have very very sharp i understand your point between a vigilante and a speculator the speculators this breed of the past ten or fifteen years with zero
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percent interest rates that has has created this enormous bond bubble price. discovery has been destroyed and the tsunami of of this inflationary cash will come into the into the market at some point but it will happen quite quite quickly it's all as a matter of fact i believe it's this is all been foretold in something called the austrian school of economics yes right ok so let's talk about the austrian school but i want to be very specific about the austrian school of economics question because this is kind of the fundamental difference between karl manga who is the founder of austrian school and louis von mieses the economist with the most american austrians would be familiar so i set you up with a the bond bubble collapse was foretold in austrian school but b. what's the difference between mangere and luke on these is to put it simply.
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did not believe in the quantity theory of money which is just a model which is just too if you like. to have on the stand but muses is a poor first quantity theories and he said well it has to be in the fly and it has to be modified to little but basically is there are. there is. an equilibrium price my guess is no the markets created this equilibrium and there are two prices bid and all for. no you only buy single prize monolithic forget it but isn't it. leans more on this thing called subjectivity whereas nieces is trying to quantify what mangere would say is
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subjective then isn't there a bit of an attempt to quantify something that manner saying is unquantifiable and ineffable absolutely meaningless one point i want to make that that's my point all the people out there the trolls that have been trolling me is that if money is going to continue please muses is known as the greatest champion against positivism but in fact when it comes to the quantity theory when he becomes a positivist him serve because he is ignoring the subjective and concentrating on the objective just what i said it but and to make that boy is a cardinal sin it. brings excommunication look at me i am the living example i've been excommunicated from the austrian.
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family school faculty know me so i have to say cool was a new school so well as far as i'm concerned there's only one school of austrian economics and that's the new school of austrian economics. ok all right professor thanks so much for you come by anytime but we have run a time off to say goodbye and thanks so much for being on the show well thank you very much into the great closer look squinting you actually all right that's all the time we have for this edition of the kaiser wait for with me max kaiser and stacey ebert like to thank our guest professor for cats at a for cancer research dot com if you'd like to contact us you can e-mail us at kaiser reported r t t v dot are you or tweet us at kaiser reporting so next time ask how does a bio. technology
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